DK Goel Solutions for Class 12 Accountancy Vol 2 Chapter 4 Common Size Statements

Chapter 4 of DK Goel Accountancy Class 12 Solutions Vol 2 Expert Accountancy learners outline Common Size Statements from the latest edition of DK Goel Accountancy Class 12 textbook solutions. MNS EdTech offers DK Goel Solutions to help students understand all of the theories in particular. Learn more about accounting principles, however, the concepts of Admission of a partner, Accounting Ratios and Cash Flow Statement is required.

DK Goel Solutions Class 12 – Chapter 4 – Part B

Question 1

The following data is related to Cambridge Ltd.

(₹ in lakhs)

Particulars	31.03.2019	31.03.2018
	₹	₹
Equity Share Capital	16	16
Preference Share Capital	2	2
Reserves and Surplus	5.4	4
Non-Current Liabilities	14.4	14
Current Liabilities	7.2	4
Non-Current Assets	30.60	28
Current Assets	14.4	12

Now, you are required to prepare a Common Size Balance Sheet.

Solution:

CAMBRIDGE LTD.

COMMON SIZE BALANCE SHEET

As at 31.3.2018 and 31.3.2019

(₹ in lakhs)

Particulars	Note No.	Absolute Amounts	% of Balance Sheet Total
2018	2019	2018	2019
		₹	₹	%	%
EQUITY AND LIABILITIES:
Shareholders’ Funds
Share Capital		18	18	45 (i)	40 (iv)
Reserves and Surplus		4	5.4	10 (ii)	12 (v)
Non-Current Liabilities		14	14.4	35 (iii)	32 (vi)
Current Liabilities		4	7.2	10	16
TOTAL		40	45	100	100
ASSETS
Non-Current Assets		28	30.6	70	68
Current Assets		12	14.4	30	32
TOTAL		40	45	100	100

Question 2

Following is the Statement of Profit and Loss of Crown Ltd. for the year ended 31.3.2018:

Particulars	Amount (₹)
Income:
Revenue from operations	2,00,000
Other Incomes	15,000
Total Revenue	2,15,000
Expenses:
Cost of Materials Consumed	1,10,000
Other Expenses	5,000
Total Expenses	1,15,000
Tax	40,000

You are required to prepare a common size statement of P & L of Crown Ltd. for the year ended 31.03.2018.

Solution:

CROWN LTD.

COMMON SIZE INCOME STATEMENT

As at 31.3.2018

Particulars	Note No.	Absolute Amounts₹	% of Revenue from Operations
Revenue from Operations		2,00,000	100
Other Incomes		15,000	7.5
Total Revenue (Revenue from Operations + Other Incomes)		2,15,000	107.5
Expenses:
Cost of Materials Consumed		1,10,000	55
Other Expenses		5,000	2.5
Total Expenses		1,15,000	57.5
Profit before Tax (Total Revenue – Expenses)		1,00,000	50
Less: Tax		40,000	20
Profit after tax (Profit before Tax – Tax)		60,000	30

Question 3

What are Common Size Statements?

Answer: Common Size Statements express all items of a financial statement as a % of some common base such as revenue from operations for P & L statement and total assets for the balance sheet.

Related Links

DK Goel Accountancy Solutions Class 12 – Part B (Chapter wise)
Chapter 2 Financial Statements Analysis	Chapter 3 Tools for Financial Analysis: Comparative Statements
Chapter 4 Common Size Statements	Chapter 5 Accounting Ratios
Chapter 6 Cash Flow Statement (As per AS – 3 Revised)	Chapter 1 Financial Statements of Companies